One of my strongly-held beliefs, for which I tend to attract supporting evidence and repel contrary arguments, is that markets process information more effectively than does the political process. Perhaps it as an exaggeration to refer to the market as the “world of truth,” as Tim Harford does in The Undercover Economist. However, it strikes me that it is easier for market forces to drive a bad firm out of business than it is for political forces to extinguish a policy that fails to meet the objectives that purportedly drive its enactment.
Those who believe in the wisdom of the political process might argue that the competition between political elites–between Democrats and Republicans or between Krugman and Limbaugh–promotes reasonable outcomes. However, I suspect that the net result of this competition is to lead to greater accretion of government power, giving the elites more to fight over. Politics ultimately becomes a competition to promise the undeliverable, whether it be better public education, inexpensive health care, or government suppression of drug abuse or sexual immorality.
Emphasis mine. That’s why it’s so important to get a private space industry going. A government space program will inevitably be captured by its rent seekers, and be almost invariably ineffective (and even counterproductive) in its stated goals, particularly given how unimportant those goals are to the body politic.
As many have noted, he wasn’t just an economist, but (like Hayek) a tireless fighter for human liberty.
[Update at 7:30 PM EST]
Here’s another link roundup. Here’s one from Brian Doherty:
Undoubtedly the most successful and influential proponent of libertarian thought in the 20th century, Milton Friedman, died last night at age 94. His successes as both a technical economist and libertarian polemicist are enormous. We can thank him, in large part, for happy events from the elimination of the draft to the conquest of inflation. Just a quick note now
For some reason, economic nationalists never seem to complain about job-killing Dutch or Irish competition. The targets of their anger are consistently China and Mexico, with occasionally whacks at Dubai, Oman, Peru, and Vietnam.
Evidence of flipping in hot markets suggesting bubble
Pollyanna “what a perfectly lovely, lovely house! How awfully glad you must be you’re so rich!”
No capital gains taxes
Thick mortgage backed securities market
Fewer new buyers chasing money
Falling real estate commissions
Rising incomes
Changing commuting patterns
“breathtaking profit”
Active Federal Reserve Board
Industry sensitive to interest rates
Rising population
Middle income wages rising in money terms
Median age rising
Family size falling
Rise in ownership of 2nd homes
Rise in telecommuting
Home entertainment such as video games eclipsing movies
Capitalization and standardization of home building industry (e.g. Toll Brothers)
A moderation in an accellerator suggests just a slow-down in the rate of growth of housing prices to me, but don’t listen to me–I just cashed out a 40% capital gain in my last house tax free and locked in a super low rate from a private equity mortgage lender and didn’t use a real estate agent to buy and used a cut commission agent to sell. Clearly I’m a Pollyanna.